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<br />INSURi\NCE REQUIREMENTS <br /> <br />In the practice of sound risk management teclmique, the City acts to transfer the risk of negligent <br />loss through contracts. Usually the City required the other party to a contract to assume the <br />City's liability arising out of the activity described in the contract This transfer generally is <br />appropriate since the contractor is most often the party in the best position to control losses. <br /> <br />This transfer of nsk is achieved by requiring contractors (along with tenants and users of public <br />facilities) to protect themselves and the City against claims or judgments arising from their <br />projects, activities or use of City facilities. The usual method to ensure that the transfer actually <br />takes place is thTOugh insurance. <br /> <br />The City's request for proposals, project standard specifications and standard agreements contain <br />a description of the required insurance. In addition, each of the above contains a "hold harmless <br />and indemnifjcation clause". This hold harmless and indemnification clause provides for the <br />contractor to assume the City's liability and defend the City in the event of a claim. <br /> <br />The insurance policy which fi.nancially supports the hold ham1less and indemnification clause <br />does not automatically become effective upon execution of the contract Coverage applies only <br />when the contractor's insurance company issues the required insurance policies or endorses <br />existing policies to conform with the City's requirements. As the coverage does not become <br />automatically effective, the City requires a current certificate of insurance before a purchase <br />order is issued <br /> <br />Specific standard insurance requirements for contractors are summarized as follows: <br /> <br />"MINIMUM LIl\HTS OF INSURANCE <br /> <br />Contractor shall maintain limits no less than: <br /> <br />1. General Liability: $1,000,000 per occurrence for bodily injury, personal injury and <br />property damage. If a form with a general aggregate limit is used, either the general <br />aggregate limit shall apply separately to the project or the general aggregate limit shall be <br />twice the required occurrence limit. <br /> <br />2. Automobile Liability: $1,000,000 per accident for bodily injury and property damage <br /> <br />3 Employer's Liability $1,000,000 per accident for bodily injury or disease <br />